Gold firms near 9-year high on stimulus bets, silver jumps 5pc
- Spot gold rose 0.6pc to $1,853.39 per ounce by 0940 GMT, after earlier hitting its highest since September 2011 at $1,865.35.
Gold pared some gains from a rally to a near nine-year peak on Wednesday as the dollar regained ground, but bets for more stimulus to ease the economic blow from surging coronavirus cases underpinned safe-haven demand for bullion.
Meanwhile, silver scaled a near seven-year high, bolstered by hopes of a rebound in industrial activity.
Spot gold rose 0.6pc to $1,853.39 per ounce by 0940 GMT, after earlier hitting its highest since September 2011 at $1,865.35.
US gold futures were 0.6pc higher at $1,854.30.
"The fact that governments, central banks and pretty much everyone else are looking to more fiscal and monetary policy inputs is helping drive the yellow metal," said Michael Hewson, chief market analyst at CMC Markets UK.
With equities struggling to push higher, gold is likely to test $1,900/oz over the next few days and weeks, Hewson said, adding that only an improvement in the pandemic situation and economy could stop gold's bull run.
Adding to a slew of global measures, European Union leaders on Tuesday sealed a 750 billion euro ($867.5 billion) recovery plan, while White House officials and top congressional Democrats also discussed another round of relief.
Non-yielding gold has surged nearly 22pc this year bolstered by low interest rates and the stimulus wave.
Coronavirus cases have crossed the 15-million threshold globally.
Restricting bullion's ascent, the dollar rose 0.1pc against rivals, after China said the US told Beijing to close its consulate in Houston.
Elsewhere, silver climbed 2.2pc to $21.79 per ounce, having hit its highest since October 2013 at $22.82.
The performance of silver, which also has industrial uses, relative to gold this month reflected market optimism for a global industry revival, said Cailin Birch, global economist at the EIU.
"Overall, we expect demand for safe-haven assets like gold and silver to remain relatively strong for the remainder of 2020."
Palladium slipped 2.2pc to $2,110.75 and platinum rose 0.6pc to $886.64.
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